NRIs can transfer funds for education, health

MUMBAI: The Reserve Bank of India has further liberalised exchange control regulations, allowing non-resident Indians and Persons of Indian Origin to repatriate funds abroad towards education and medical expenses.
It has also permitted the repatriation of proceeds from property sales.
The central bank has said that NRIs and PIOs will be allowed to repatriate upto $30,000 out of balances held by them in their non-resident ordinary rupee (NRO) accounts to meet the educational expenses of their children and upto $100,000 to meet medical expenses of the accountholder or his family members.
At present, a number of people in India arrange for their children’s educational expenses to be paid by relatives living overseas.
The repayment is made either by crediting the relative’s bank account in India or paying him in cash. Cash is very often the form of repayment to avoid paying taxes. Medical expenses too, are repaid this way.
The RBI has also permitted repatriation of sale proceeds of immovable property upto $100,000 per year. The property, however, would have had to be held by them for a period of not less than 10 years.
In addition, in order to facilitate setting up base abroad, RBI has enhanced the repatriation limit to $25,000 to residents who have obtained emigration visas.
At present, residents proceeding abroad on emigration are permitted to carry only upto $5,000 with them. The decision to increase the repatriation limit for resident Indians emigrating, would help a great deal in reducing hawala transactions.
The Reserve Bank has been making relaxations on the exchange control front in a phased manner over the last couple of years.
In December last year, it permitted authorised dealers to allow employees of foreign companies to remit foreign exchange for the purchase of shares of the foreign company under the Employees’ Stock Option Plan.
Only employees of wholly-owned subsidiaries or branch offices of a foreign company or a company in which the shareholding of a foreign company is not less than 51 per cent, can make use of this facility.